The Federal Reserve held interest rates steady on Wednesday, according to Reuters. It gave no clear signal on when cuts might begin and drew dissent from two Trump-appointed governors who view current policy as too tight. Fed Chair Jerome Powell emphasized a wait-and-see approach, stating no decision had been made regarding the next meeting in September. The cautious stance led markets to scale back expectations for near-term easing, with futures traders now seeing a 46% chance of a cut in September, down from 65% a day prior. Treasury yields and the dollar rose on the news, while stocks dipped, particularly small caps. Powell’s reluctance to signal rate cuts will keep investors focused on upcoming inflation and jobs data, adding near-term pressure to small-cap stocks.
